About 10% of small businesses with existing employees close down each year.
The figure for businesses with no employees? 30%.
It’s a dire statistic.
And it’s exactly why small businesses have to always be on their toes; being a small business often means that you don’t have the backup funds to support yourself in times of crisis.
You should constantly be considering ways to make your small business more profitable, not just when you’re at your wits ends.
How can a small business make more money?
There are a number of measures business owners can take to try to increase their business revenue.
Most of the time, you’ll have to do more than one of the things we outline simultaneously.
Nothing is ever a guarantee, but it’s strongly recommended that you always get the help of a small business accountant in Bayside to gain advice on how to increase profits for your business.
The following points outlined, may or may not be relevant to you depending on:
- If you are close to liquidation
- How much debt you have
- If you have a bookkeeper or accountant
- If you have a marketing team
- If you are good at analysing trends and looking at data
Be inspired by similar businesses
If you find yourself being jealous of other small businesses like yours that are a lot more successful, why not try and analyse what they do differently, and how you can close the gap between them and you?
Once you’ve established businesses that are your biggest competitors, threats, or ones you admire, analyse and take notes of:
- Their website
- Their online presence on social media
- The services they offer
- Their pricing structure
- Any other conversion tactics like guarantees, free quotes, free trials etc.
Compare these aspects to the same aspects of your business to uncover where the differences lie. Then, think about what makes them so appealing!
Think of new creative ways to get more customers
Often the first thing business owners think to do when they are wanting to see a financial increase, is to evaluate internal processes, such as letting go of staff or strict budgeting.
But sometimes you just need to be inventive and think of new ways to gain customers (as well as upsell to your current ones – more on that below).
Large businesses will often carry out competitions, contests, and giveaways, but generally smaller businesses don’t have the funds to do things like this as there are risks involved with them.
Smaller businesses may do some of the following things instead:
- Create a new product
- Rebrand or relabel existing products or service
- Create deals such as free delivery after you spend a certain amount
- Offer referral discounts
- Create a membership system with benefits to members only
Or you can have a deal for first time customers; promote a discount or special pricing for new customers to encourage them to test you out.
Upsell to your current customers
If you have regular customers, they probably continue to choose you for a reason.
These reasons are generally things like trust, reliability, good rapport, and the quality of your work.
Therefore, it might not hurt to consider reaching out to your customers and providing them an offer to add an extra service, upgrade their older product, or move up to another plan.
Think of advertising tactics
To get a new customer’s attention in the first place, you need to orchestrate specific and planned marketing tactics.
Implement digital marketing tactics that steer clients in your business’s direction when they are actively searching for your goods and services online.
Consider a social strategy, too, to keep in touch with customers, offer an easy way to get in touch, and promote news and products online.
Just this year, Australia reported almost 80 per cent of its population to be active users of social media – a staggering number when it comes to business visibility and awareness.
Budget and planning
As fun as being creative is, you also always need to check and evaluate your internal systems to see if you’ve been missing out on great opportunities or are overspending in one specific area of your business.
For example, maybe you’ve been investing money into one particular service or product that isn’t seeing many sales at all, and you’re actually losing money by advertising it.
If you have a team of accountants, bookkeepers, executives, and data analysts, then start to hold more regular meetings to discuss trends and financial standings.
Look at your business budget, business plan, and financial plan constantly and rewrite it according to recent events.
If your business is too small for the need of a full time accountant, then you should consider outsourcing to a small business accountant in Melbourne instead to provide clarity on your budget and spending.
Speak to an accountant
Outsourcing your accounting is a more cost-effective solution, particularly for small businesses.
Depending on the size of your business, we typically see our clients between five and 10 times a year.
There are other ways business accounting in Melbourne can increase your profits besides looking at your budget, business plan, and financial plan, such as:
- Helping with taxes
- Making sure you’re legally compliant
- Liaising with your bookkeeper
- Creating financial forecasts
- Managing your superannuation
- BAS and IAS lodgments
- Analysing profit vs cash flow
How can accounting increase profitability?
When you hire an accountant, they essentially look at anything related to finances – the cornerstone of your business.
Therefore, they can pinpoint small mistakes, such as maths being wrong on one of your plans or payroll, which can lead to very big mistakes and a loss of money,
They can also tell you what you’re doing right and wrong financially in every sector of your business and can also act as small business tax agents.
How do accountants help with taxes?
Accountants can recommend what tax structure you should use if you’re about to start a business, or they can recommend you to change your current structure.
Taxes need to be lodged somewhere between every quarter and once a year by business owners. And a tax return accountant in Melbourne can tell you how often and how exactly to lodge them.
They can help you with relevant deductibles and tell you exactly what to write for different returns.
How can an accountant help your business?
Wanting to find ways to make your business more profitable?
Whether you’re struggling to make ends meet or you’re soaring and want to keep up the momentum, Bruce Edmunds & Associates is available to assist you and help you increase your business profits.
Bruce Edmunds is an accounting firm in Bayside that helps small and self-run businesses succeed.